Coupa	  Tony	  Wessels	  Vice	  President,	  Marke0ng	  
Thank	  You	  
Coupa	  Ravi	  Thakur	  Vice	  President,	  	  Customer	  Success	  
KPMG	  Keaton	  Miller	  Director,	  	  Procurement	  Advisory	  
Jack	  Miles	  Industry	  Visionary,	  Former	  CPO	  CIGNA	  CA,	  	  Inc.,	  AIG,	  CIBC,	  Travelers,	  
Michaels	  Stores	  Tom	  Brewer	  	  Vice	  President,	  Shared	  Services	  
Coupa	  Bhaskar	  Deka	  Sr.	  Director,	  Product	  Marke0ng	  
You	  AEendee,	  Coupa	  Roadshow	  
Coupa Overview         Tony WesselsVice President, Marketing
Coupa’s	  Mission	     Delivering software innovation that breeds    responsible spending while impacting the             ...
Coupa’s	  Mission	     Delivering software innovation that breeds    responsible spending while impacting the             ...
InnovaCon	  –	  Integrated	  Cloud	  PlaGorm	         Yesterday          	                Today        	       Client Serv...
Coupa’s	  Mission	     Delivering software innovation that breeds    responsible spending while impacting the             ...
Responsible	  Spending	  –	  User	  AdopCon	        Yesterday       	                   Today     	   Back Office - Process...
Coupa’s	  Mission	     Delivering software innovation that breeds    responsible spending while impacting the             ...
Impact	  BoKom	  Line	      Yesterday            	                       Today         	    Products      	               ...
Coupa’s	  Explosive	  Growth	  180%	   Bookings	                  +95%	                  Renewal	  Rate	                  ...
One	  World,	  One	  PlaGorm	  10  	  Languages	  40	     Countries	  
Customers	  Highlights	    Retail   Finance   Mfg.     Health Care   High Tech                                            ...
Coupa Vision   Platform Overview                  Ravi ThakurVice President, Customer Success                             ...
 	  	  	  	  	  CFO	  	  	  	  	  	  	  	  Journal	  Entries	  	  	  	  	  	  	  	  	  	  VP	  Sales 	  	  	  OpportuniCes...
Starts	  With	  the	  Employee	  
Employees	  Have	  DramaCcally	  Changed	  
Our	  Vision	  is	  the	  Coupa	  PlaGorm	  
The	  Coupa	  PlaGorm	  
The	  Coupa	  PlaGorm	  
The	  Coupa	  PlaGorm	  
The Most Active Cloud Procurement 	     Platform On the Planet	          99.9% Uptime SLA	        500,000 Daily Transactio...
 	  	  Seamlessly	  Integrated	  PlaGorm	                                                   	                          Con...
RequisiCon	  to	  Approved	  Invoice	                         • 18,000 Users	                       • 3,500 Locations	    ...
RequisiCon	  To	  PO	  	  Receipt                                                    	                             • 1,000...
RequisiCon	  To	  PO	                                  • Over 6,000 users	                                • Integration to...
Demonstration
Marketing		               Roadmap	  Influencers                                   	                                    Mark...
What	  this	  All	  Means	  to	  You	  
Thank	  You!            	  
Sustaining Value Through Integrated   Procurement Transformation                              Keaton Miller            Dir...
Procurement Advisory at KPMG                                                     Our mission is to make Procurement a     ...
Session objectives                                         n     Discuss the key elements of an integrated               ...
KPMG has an integrated, life-cycle view of the procurement function                       It is critical to recognize the ...
Value leakage can occur at every stage of the Source-to-Pay cycle                      Strategic Sourcing            Contr...
Technology is a key enabler for procurement effectiveness andtransactional efficiency…                                    ...
… Yet most companies are immature adopters of procurementtechnology               Very few companies exhibit Leading or Ex...
The procurement technology landscape has evolved dramatically –making it easier to successfully adopt                  Typ...
Optimizing use of the cloud as part of your technology strategy canserve as a game changer                                ...
KPMG recognizes that procurement transformation is a journey – not adestination© 2012 KPMG LLP, a Delaware limited liabili...
We understand the keys to transformation success…        Top 10 Risks toTransformation        Programs *                  ...
… And have found that an integrated approach to transformation candrive sustainable value          Addressing eProcurement...
In summary…        •  World-class performance in procurement can be achieved and           can drive sustainable business ...
For more information….      …Email our KPMG Procurement Advisory Mailbox…      us-advbeprocureadv@kpmg.com      …Contact u...
© 2012 KPMG LLP, a Delaware limited liabilitypartnership and the U.S. member firm of the KPMGnetwork of independent member...
Conversations with an Industry                  Visionary                                                                 ...
Break
Agenda	  Time	         Item	                                   Presenter	8:30 – 9:00     Coffee                           ...
Customer Success – Best Practices	             Tom Brewer                      	            VP, Shared Services	          ...
Michaels Stores                                             •  Over 1,000 stores in U.S. and                              ...
Michaels Vision  Strategy             A World-Class Performer that: Vision             • Inspires and enables consumers to...
The Goal….•  Reduce invoice coding and approval time by   60% (support department )•  Reduce invoice processing effort by ...
The Decision….•  Oracle Financials rolled out in 2006  •  Needed to implement many modules to function effectively        ...
The Journey – Identifying Opportunities•  Conducted workshops and interviews   •  Captured Voice of Customer (VOC)   •  Id...
The Journey – Analyze  Identify Waste• Charted an Affinity diagram to   • Identify all process improvement opportunities  ...
Achieving the Goal….•  With vendor interface the vendor invoices will presented by the vendor   in the tool to eliminate t...
Where we are…..•  Capital and expense items for corporate and DC’s operational   •  Using punch outs to vendor catalog and...
The Journey – Reaping the Benefits•  Shifted effort of invoice coding and   approval time from departments to AP•  Saving ...
Next Steps •  Partner with Coupa to add Budget/Project tracking into    system •  Coupa setup allows only authorized acces...
Questions            ???            Michaels Privileged    Confidential                                                   68
Calculating TCO For A Rock Solid Business Case                           Bhaskar Deka  Sr. Director, Product Marketing    ...
Making	  the	  Business	  Case	  May	  Seem	  Complicated	  	  ..	  
Especially,	  with	  3	  Deployment	  OpCons	  …	    On-­‐Premise	  	  	           Hosted	  	  	       SaaS/Cloud	  	  	  ...
Which	  OpCon	  Is	  The	  Best	  For	          The	  Long	  Term?	  	   	  	  	  Customer	  Records	  
TCO	  To	  The	  Rescue	     TCO	  Whitepaper	           TCO	  Calculator	  Tool	  
Are	  You	  Familiar	  With	  Total	  Cost	  Of	  Ownership	  (TCO)	  Analysis	  ?	  §  Yes,	  used	  TCO	  Analysis	  be...
What	  is	  TCO?	            Direct	  Cost                       	                                                        ...
Why	  Care	  about	  TCO?	  §  SoluCon	  costs	  vary	  greatly	  based	  on	  the	  delivery	    model	  §  Need	  a	  ...
Key	  Metrics	  to	  Consider	  for	  TCO	          Company	  Profile	                   Environmental                     ...
Cost	  Drivers	  For	  Procurement	  AutomaCon	  Cost Driver	                   On-Premise	             Cloud	Software	   ...
Soft Costs  Gotchas                          	Project	                             Cost	  of	  Delaying	                Co...
4	  Steps	  for	  TCO	  Analysis	                        Evaluate Functionality	                 Determine Initial/Upfront...
4	  Steps	  for	  TCO	  Analysis	                        Evaluate Functionality	                 Determine Initial/Upfront...
4	  Steps	  for	  TCO	  Analysis	                        Evaluate Functionality	                 Determine Initial/Upfront...
4	  Steps	  for	  TCO	  Analysis	                        Evaluate Functionality	                 Determine Initial/Upfront...
Case	  Study	  	   Fortune	  100	  Manufacturing    	  §  $2	  Billion	  Manufacturer	  of	  Energy	  Related	  Materials...
Case	  Study	  	  Fortune	  100	  Manufacturing                                  	            Cost Categories             ...
One	  Time	  Costs	          Cost Categories                             Cloud                                            ...
One	  Time	  Costs	          Cost Categories                             Cloud                                            ...
One	  Time	  Costs	          Cost Categories                            Cloud                                             ...
Annual	  Costs	         Cost Categories                             Cloud                                                 ...
Annual	  Costs	         Cost Categories                             Cloud                                                 ...
Annual	  Costs	         Cost Categories                             Cloud                                                 ...
Results	                                        Year 1                 Year 2                Year 3Procure to Pay Costs Su...
Results	                                Cumulative Total Cost of Ownership                          Initial Investment Yea...
Calculate	  Your	  Own	  TCO	    TCO	  Whitepaper	      TCO	  Calculator	  Tool	  
Closing Remarks         Tony WesselsVice President, Marketing
Coupa 'Crank Up The Savings' Road Show - Dallas
Coupa 'Crank Up The Savings' Road Show - Dallas
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Coupa 'Crank Up The Savings' Road Show - Dallas

  1. 1. Coupa  Tony  Wessels  Vice  President,  Marke0ng  
  2. 2. Thank  You  
  3. 3. Coupa  Ravi  Thakur  Vice  President,    Customer  Success  
  4. 4. KPMG  Keaton  Miller  Director,    Procurement  Advisory  
  5. 5. Jack  Miles  Industry  Visionary,  Former  CPO  CIGNA  CA,    Inc.,  AIG,  CIBC,  Travelers,  
  6. 6. Michaels  Stores  Tom  Brewer    Vice  President,  Shared  Services  
  7. 7. Coupa  Bhaskar  Deka  Sr.  Director,  Product  Marke0ng  
  8. 8. You  AEendee,  Coupa  Roadshow  
  9. 9. Coupa Overview Tony WesselsVice President, Marketing
  10. 10. Coupa’s  Mission   Delivering software innovation that breeds responsible spending while impacting the company bottom line.
  11. 11. Coupa’s  Mission   Delivering software innovation that breeds responsible spending while impacting the company bottom line.
  12. 12. InnovaCon  –  Integrated  Cloud  PlaGorm   Yesterday Today Client Server Cloud Bolt-on Functionality Organic, Integrated Functionality
  13. 13. Coupa’s  Mission   Delivering software innovation that breeds responsible spending while impacting the company bottom line.
  14. 14. Responsible  Spending  –  User  AdopCon   Yesterday Today Back Office - Process Automation Users Spend Money Complicated, Time Consuming Convenient familiar
  15. 15. Coupa’s  Mission   Delivering software innovation that breeds responsible spending while impacting the company bottom line.
  16. 16. Impact  BoKom  Line   Yesterday Today Products Service Customer Customer Satisfaction Success
  17. 17. Coupa’s  Explosive  Growth  180%   Bookings   +95%   Renewal  Rate   150%   YOY   YOY   Pla7orm  Usage   YOY  
  18. 18. One  World,  One  PlaGorm  10  Languages  40   Countries  
  19. 19. Customers  Highlights   Retail Finance Mfg. Health Care High Tech Real Estate
  20. 20. Coupa Vision Platform Overview Ravi ThakurVice President, Customer Success
  21. 21.            CFO                Journal  Entries                    VP  Sales      OpportuniCes    VP  HR          Employee  Records      Procurement        Spend  TransacCons  
  22. 22. Starts  With  the  Employee  
  23. 23. Employees  Have  DramaCcally  Changed  
  24. 24. Our  Vision  is  the  Coupa  PlaGorm  
  25. 25. The  Coupa  PlaGorm  
  26. 26. The  Coupa  PlaGorm  
  27. 27. The  Coupa  PlaGorm  
  28. 28. The Most Active Cloud Procurement Platform On the Planet 99.9% Uptime SLA 500,000 Daily Transactions 300,000 Suppliers 4+ API Calls p/Second
  29. 29.      Seamlessly  Integrated  PlaGorm     Contract Source Analyze Order Ack 2 3 Execute ASN Way MatchPurchase Requisition Requisition PO Issued Order Invoice Invoice Need Submitted Approval To Supplier Fulfilled Received Paid User Confirm Sourced Receipt
  30. 30. RequisiCon  to  Approved  Invoice   • 18,000 Users • 3,500 Locations • 4,000 + PO’s Invoices p/day • OK to Pay Invoices flow into Lawson • Emptoris Integration for Advanced Contracts Purchase Requisition Requisition PO Issued Order Invoice Invoice Need Submitted Approval To Supplier Fulfilled Received Paid
  31. 31. RequisiCon  To  PO    Receipt   • 1,000 users • Over 500k Catalog Items • Over 500 Custom Views • PO’s and PO changes flow into SAP • Receipts flow into SAP Purchase Requisition Requisition PO Issued Order Invoice Invoice Need Submitted Approval To Supplier Fulfilled Received Paid
  32. 32. RequisiCon  To  PO   • Over 6,000 users • Integration to McDonalds Intranet Applications • Over 4,000 logins daily • Over 10,000 p-cards Purchase Requisition Requisition PO Issued Order Invoice Invoice Need Submitted Approval To Supplier Fulfilled Received Paid
  33. 33. Demonstration
  34. 34. Marketing Roadmap  Influencers   Market Customers Innovation
  35. 35. What  this  All  Means  to  You  
  36. 36. Thank  You!  
  37. 37. Sustaining Value Through Integrated Procurement Transformation Keaton Miller Director, KPMG
  38. 38. Procurement Advisory at KPMG Our mission is to make Procurement a competitive differentiator for our clients. Category Sourcing Supplier Risk Management Management Organizational Process effectiveness Optimization Rapid Assessment Tax Efficient Technology Enablement procurement Supplier Relationship Master Data Management Management© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 40member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  39. 39. Session objectives n  Discuss the key elements of an integrated procurement target operating model n  Provide a high-level overview and insight into how the procurement technology space has evolved in response to customer demand for innovation and lower cost of ownership n  Highlight critical success factors of an integrated approach for successful and sustained procurement transformation© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 41member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  40. 40. KPMG has an integrated, life-cycle view of the procurement function It is critical to recognize the interconnectedness of the different components: Strategic Sourcing generates the savings while Transactional Procurement delivers them to the bottom line. Vendor Risk and Portfolio Management help preserve the value delivered.© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 42member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  41. 41. Value leakage can occur at every stage of the Source-to-Pay cycle Strategic Sourcing Contract Management Operational Procurement Supplier Management   Total cost levers Established contract Procurement Intelligence Formalized supplier Leading Practice   Cross-functional team management teams Documented policies Defined KPIs and management program approach Defined contract and procedures metrics Dedicated supplier   Rigorous tracking of management plans End-to-end process Enterprise tracking account teams generated savings Active performance visibility and and Reporting Aligned KPIs and transition transparency Data accuracy and management Standardization and reliability automation Identify Deliver Sustain Lack of business Limited visibility to Disparate processes Abundance of data; Exception-based Common Practice buy-in to sourcing negotiated contracts and tools little intelligence supplier management strategies Paper contracts Few upfront purchase Incomplete, incorrect, Tactical interactions Limited use of eRFx distributed across orders inconsistent data – versus strategic tools organization ‘After-the-fact’ materials and vendors relationships Lack of transparency High degree of approvals Spend data dispersed Limited supplier around supplier off-contract spend Blocked invoices across multiple collaboration and selection Conflicting/duplicate systems; Enterprise sharing of data Duplicate payments view not available Buyers too focused on contracts with the tactical purchasing same vendors Limited use of ACH/ EFT© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 43member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  42. 42. Technology is a key enabler for procurement effectiveness andtransactional efficiency… Process – P2P processes, activities and tasks for each of the buying channels including the mapping to specific functions and departmental roles performing them. Processes People Organization – Procurement operating model (centralized, center-led, decentralized), Organization roles, responsibilities and people that should be supporting the defined process. People Organization Layer Governance Policies – Policies, procedures and controls in place to mitigate risk of processing errors, linked to specific steps in the Requisition-to-Pay process. Governance Policies Performance Measurement – Internal key performance indicators and metrics to manage people and processes, and drive correct behavior. Includes procurement operational and executive Performance reporting needs. Measurement Master Data – Quality of master data associated with procurement and invoicing processes e.g. materials, services, vendors, commodity codes, etc. Includes processes and controls to maintain Master Data master data and sustain its quality. Technology Tools – tools and applications that are used to enable the P2P processes, policy compliance, internal controls, and report generation. Technology Tools© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 44member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  43. 43. … Yet most companies are immature adopters of procurementtechnology Very few companies exhibit Leading or Excellence maturity levels for procurement technology – levels that indicate that users are empowered to use technology, and procurement can refocus on 100% strategic work 82% 80% 60% 18% 40% 20% 0% Financial Services Health Manufacturing / Public Sector Retail TMT / Busn Transportation / ENR Process Not for Profit CPG Services Logistics Foundational or Established Leading or Excellence Source: KPMG’s Power of Procurement Survey, 2012© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 45member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  44. 44. The procurement technology landscape has evolved dramatically –making it easier to successfully adopt Typical Procurement 1.0 Landscape Procurement 2.0 Landscape Contract Sourcing Management Spend RFx Analytics Spend Contract Sourcing Analytics RFx) Management ERP Operational Supplier Procurement Collaboration Supplier Operational Collaboration Invoicing Invoicing Procurement ERP Key Characteristics of the typical procurement Key Characteristics of an evolving procurement 1.0 landscape: 2.0 landscape: n  Standalone, single purpose point solutions n  Suite-oriented solutions n  Low to moderate degrees of integration n  Tight integration n  On-Premise Centric n  Open standards n  High Total Cost of Ownership n  Greater accessibility and scalability n  Less focused on end user experience n  Greater use of on-demand resources n  Internal and external collaboration tools n  Oriented towards the end user experience¹ Operational procurement includes requisitioning, purchase order, and receiving functions© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 46member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  45. 45. Optimizing use of the cloud as part of your technology strategy canserve as a game changer Innovations in procurement are being delivered through the cloud §  The cloud is already changing how we collaborate with our coworkers and business partners, and the speed at which those interactions can occur. §  By virtualizing processes, the cloud creates new opportunities and business models for deployment. §  By removing traditional barriers to access, the cloud has created a resurgence in demand for technology, by making investments in innovation more affordable to companies of all sizes and scale© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 47member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  46. 46. KPMG recognizes that procurement transformation is a journey – not adestination© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 48member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  47. 47. We understand the keys to transformation success… Top 10 Risks toTransformation Programs * Critical Success Factors Culture 54% Inappropriate org structure 48% 1.  Focus on people and changing behaviors Employee resistance 46% Senior mgmt resistance 45% 2.  Start generating savings early to establish credibility Fear 43% Change overload 36% 3.  Striking the right balance between “running the business” and Ineffective performance measurement 33% “transforming the business” Failure to sustain momentum 23% 4.  Include internal and external Failure of past projects 21% stakeholders in the journey 5.  Recognize the role of foundational elements to drive sustainable savings Includes Technology * Source: Mori Study Enablement© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 49member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  48. 48. … And have found that an integrated approach to transformation candrive sustainable value Addressing eProcurement, Contract Management, Classical Strategic Sourcing, Organization and Technology together will: •  Accelerate the time to achievement of savings •  Generate additional value and savings •  Sustain value and savings by ensuring compliance to preferred suppliers and contracts Integrated approach Sustained benefit due to compliance Additional value Speed Sourcing alone Benefit eProcurement and Contract Mgmt alone Time to value© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 50member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  49. 49. In summary… •  World-class performance in procurement can be achieved and can drive sustainable business value •  Dramatic changes in procurement technology now makes adoption of foundational enablers easier and more cost effective •  Current cloud technology-enabled procurement transformation programs demonstrate feasibility and tangible, realizable benefits© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 51member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  50. 50. For more information…. …Email our KPMG Procurement Advisory Mailbox… us-advbeprocureadv@kpmg.com …Contact us directly… Samir Khushalani Keaton Miller Principal Director Advisory Advisory KPMG LLP Tel 713 319 3570 KPMG LLP Tel 713 319 3825 811 Main Street Cell 713 459 2236 811 Main Street Cell 214 316 9682 Houston, TX 77002 Houston, TX 77002 skhushalani@kpmg.com keatonmiller@kpmg.com KPMG is a U.S. limited liability partnership. KPMG is a U.S. limited liability partnership. …Or visit our website at www.kpmg.com! What We Do Advisory Management Consulting By Function Strategic Sourcing Procurement© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 52member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  51. 51. © 2012 KPMG LLP, a Delaware limited liabilitypartnership and the U.S. member firm of the KPMGnetwork of independent member firms affiliated withKPMG International Cooperative (“KPMGInternational”), a Swiss entity. All rights reserved.108976The KPMG name, logo and “cutting throughcomplexity” are registered trademarks or trademarksof KPMG International.
  52. 52. Conversations with an Industry Visionary Jack Miles Former CPO, CIGNA© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 54 54member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.52188DAL
  53. 53. Break
  54. 54. Agenda  Time Item Presenter 8:30 – 9:00 Coffee All9:00 – 9: 15 Welcome – Coupa Overview Tony Wessels,V.P. Marketing Coupa9:15 – 10:00 Coupa Solution Roadmap Ravi Thakur,V.P. Customer Success, Coupa10:00 – 10:30 Sustaining Value Through Integrated Keaton Miller, Director, KPMG Transformation10:30 – 11:00 Conversation with an Industry Visionary Jack Miles, Former CPO CIGNA11:00 – 11:15 Break All 11:15 – 11:45 Customer Success – Best Practices Tom Brewer,V.P. Shared Services, Michaels11:45 – 12:15 Calculating TCO Bhaskar Deka, Sr. Director Product Marketing, Coupa12:15 – 12:30 Closing Remarks Tony Wessels12:30 – 1:00 Coupa Demo
  55. 55. Customer Success – Best Practices Tom Brewer VP, Shared Services Michaels Stores 57
  56. 56. Michaels Stores •  Over 1,000 stores in U.S. and Canada •  40,000+ SKUs across a variety of general kids crafts, art supplies, framing and seasonal / décor categories •  $4.0 Billion in RevenueCategory Leader in Arts Crafts Michaels Privileged Confidential 58
  57. 57. Michaels Vision Strategy A World-Class Performer that: Vision • Inspires and enables consumers to experience creativity • Leads industry growth innovation • Creates a fun and rewarding place to work that fosters meaningful connections with our communities PEOPLE: World-Class Workforce / Environment / PerformanceStrategic Store Category Global Cash Mark- CustomerPriorities Growth Mgmt Sourcing Flow eting Experience CO-SOURCING: Systems Process Enablers Michaels Privileged Confidential 59
  58. 58. The Goal….•  Reduce invoice coding and approval time by 60% (support department )•  Reduce invoice processing effort by 25% (Accounts Payable)•  Reduce costs for invoice scanning and online retention by 30%•  Improve On time payment by 25%•  Ensure 100% centralized systemic visibility to complete non-merchandise purchase obligations (Compliance)•  Corporate-wide systemic process •  To record PO obligation •  Leverage authorized suppliers and items Lean Process and Improved Accuracy Michaels Privileged Confidential 60
  59. 59. The Decision….•  Oracle Financials rolled out in 2006 •  Needed to implement many modules to function effectively •  iSupplier •  Procurement •  Purchasing •  Projects •  No available capital or resources for an indirect spend tool•  Coupa provided ease of use and quick start for the process •  No capital investment or IT resources required •  Offered control and approval to spend before PO placed •  Consistent use of approved vendors Lean Process and Improved Accuracy Michaels Privileged Confidential 61
  60. 60. The Journey – Identifying Opportunities•  Conducted workshops and interviews •  Captured Voice of Customer (VOC) •  Identified Improvement Opportunities •  Segregated Effort and Process Control related Issues•  Conducted Surveys to estimate AS-IS Effort•  Completed Process Mapping for finding process bottlenecks. Michaels Privileged Confidential 62
  61. 61. The Journey – Analyze Identify Waste• Charted an Affinity diagram to • Identify all process improvement opportunities • Classify and group opportunities• Built Value Stream Map to determine •  Value adding enabling steps (essentials) •  Non value adding steps (Wastes) Manual Rejection $3,000,000.00 $2,576,050.00 $2,500,000.00 • Identified Manual Efforts, rework and errors to $2,000,000.00 $ Value $1,500,000.00 $1,356,432.00 be reduced $1,000,000.00 $931,822.00 $568,858.00 $473,442.00 $500,000.00 $- $- Duplicate Missing Clarification Miscellaneous Approval Incorrect Payment Information Missing Payment • Cash flow impact analysis to ensure no Type of Errors negative impacts on cash flow Michaels Privileged Confidential 63
  62. 62. Achieving the Goal….•  With vendor interface the vendor invoices will presented by the vendor in the tool to eliminate the need to: •  Scan •  Route to departments for approval •  Coding is linked PO eliminating the need to add coding •  Recover invoices•  Tool will hold all PO’s for indirect spend•  Control vendor setup to only approved vendors and pricing•  Interface Payment information from AP to Tool to aid vendor in payment status Lean Process and Improved Accuracy Michaels Privileged Confidential 64
  63. 63. Where we are…..•  Capital and expense items for corporate and DC’s operational •  Using punch outs to vendor catalog and selected items build into our item list•  Suppliers link invoicing into tool•  Electronic invoicing•  Over 5,000 PO’s / $83 M orders $18.0   $16.0   $14.0   $12.0   $10.0   $8.0   $6.0   $4.0   $2.0   $0.0   2011  Q1   2011  Q2   2011  Q3   2011  Q4   2012  Q1   2012  Q2   Lean Process and Improved Accuracy Michaels Privileged Confidential 65
  64. 64. The Journey – Reaping the Benefits•  Shifted effort of invoice coding and approval time from departments to AP•  Saving from Accounts Payable Invoice Processing•  Improved Working Capital•  Control of budgets and projects in one central tool•  CFO – controls for projects Projected benefit is HUGE Michaels Privileged Confidential 66
  65. 65. Next Steps •  Partner with Coupa to add Budget/Project tracking into system •  Coupa setup allows only authorized access to set item level data to include account coding •  Linked with Tax Department for reporting •  Invoice approval in tool with feed to AP for funding •  Develop reverse feed into tool of Spend data for analysis and accruals Michaels Privileged Confidential 67
  66. 66. Questions ??? Michaels Privileged Confidential 68
  67. 67. Calculating TCO For A Rock Solid Business Case Bhaskar Deka Sr. Director, Product Marketing
  68. 68. Making  the  Business  Case  May  Seem  Complicated    ..  
  69. 69. Especially,  with  3  Deployment  OpCons  …   On-­‐Premise       Hosted       SaaS/Cloud       You Manage: You Manage: Vendor Manages: §  Application §  ApplicaCon   §  Application §  Runtime §  RunCme   §  Runtime §  IntegraCon   §  Integration §  Integration §  Database   §  Database §  Database §  Server Hardware/ §  Server Hardware/ Vendor Manages: Software Software §  Server Hardware/ §  Storage §  Storage Software §  Network §  Network §  Storage §  Network
  70. 70. Which  OpCon  Is  The  Best  For   The  Long  Term?          Customer  Records  
  71. 71. TCO  To  The  Rescue   TCO  Whitepaper   TCO  Calculator  Tool  
  72. 72. Are  You  Familiar  With  Total  Cost  Of  Ownership  (TCO)  Analysis  ?  §  Yes,  used  TCO  Analysis  before  §  Yes,  sort  of  familiar    §  No,  never  used  
  73. 73. What  is  TCO?   Direct  Cost   Indirect  Cost  §  Hardware   §  InstallaCon  §  Sohware   §  Training   §  Professional  Services   §  Upgrades   Over  the  lifeCme  of  an  Asset  ..  
  74. 74. Why  Care  about  TCO?  §  SoluCon  costs  vary  greatly  based  on  the  delivery   model  §  Need  a  simple  model  to  compare  cloud  vs.  on-­‐ premise/hosted  soluCons  §  IniCal  terms  look  aKracCve  but  will  crush  you  in   the  long  run  
  75. 75. Key  Metrics  to  Consider  for  TCO   Company  Profile   Environmental   Complex  §  #  of  Users   §  #  of  Purchase  Orders   §  #  of  ERP  instances  §  Expected  user   §  #  of  Invoices   §  #  of  Other   growth   §  #  of  Catalogs   IntegraCon  Points  §  Spend  through   §  #  of  Suppliers   §  #  of  Custom  Fields   system   §  #  of  Punch-­‐outs   §  #  of  Complex  §  Expected  growth  of   Approval  Rules   spend  through   system  §  #  of  LocaCons  
  76. 76. Cost  Drivers  For  Procurement  AutomaCon  Cost Driver On-Premise Cloud Software 1x Licensing Cost Annual Subscription Hardware Infrastructure Servers Databases No fees Configuration/Implementation Professional Services Set-up fees Data Migration Extensive Minimal User Training Required Lower Cost – Ease of Use Annual Maintenance 19 – 20% of Software None 78
  77. 77. Soft Costs Gotchas Project   Cost  of  Delaying   Complex  Management   Savings     Requirements    •  Costs  of  engaging   •  Many  projects  never   •  Custom  forms    ?ields,   with  IT   get  started   multiple  charts  of  •  Time  away  from   •  Savings  are  delayed   accounts   more  strategic  tasks   or  never  begin   •  Special  features  can   double/triple  cost  
  78. 78. 4  Steps  for  TCO  Analysis   Evaluate Functionality Determine Initial/Upfront Costs Identify Annual/Recurring Costs Enter Data into TCO Tool Compare Optons
  79. 79. 4  Steps  for  TCO  Analysis   Evaluate Functionality Determine Initial/Upfront Costs Identify Annual/Recurring Costs Enter Data into TCO Tool Compare Optons
  80. 80. 4  Steps  for  TCO  Analysis   Evaluate Functionality Determine Initial/Upfront Costs Identify Annual/Recurring Costs Enter Data into TCO Tool Compare Optons
  81. 81. 4  Steps  for  TCO  Analysis   Evaluate Functionality Determine Initial/Upfront Costs Identify Annual/Recurring Costs Enter Data into TCO Tool Compare Optons
  82. 82. Case  Study     Fortune  100  Manufacturing  §  $2  Billion  Manufacturer  of  Energy  Related  Materials  §  Decentralized  purchasing   -  Plant  managers  control  material   -  Services  procurement  (45%  of  spend)  black  hole  §  ParCally  Centralized  AP  with  Imaging   -  1,200,000  annual  invoices   -  Limited  EDI/Electronic  Invoices  §  Issues/Pains   -  Lots  of  paper/long  PO  approval  cycle   -  No  visibility  to  non-­‐PO  purchases     -  Late  payments/Missed  discounts   -  Too  much  manual  effort  
  83. 83. Case  Study    Fortune  100  Manufacturing   Cost Categories Cloud Year 1 Traditional Cloud Year 2 Traditional Cloud Year 3 Traditional   and Network and Network and Network One Time Costs Software Hardware Software License $137,500 Software Upgrades $15,000 Hardware Infrastructure $35,000 Software Hardware $0 $172,500 $0 $15,000 $0 $0 Typical Configuration Implementation: Data migration $0 $75,000 Services Procurement $0 $60,000 Catalogs $0 $22,500 Punch-outs $0 $15,000 $0 $15,000 $0 $15,000 Professional services $0 $175,000 Program management (vendor) $0 $150,000 Training $0 $90,000 Typical Configuration Implementation: $0 $622,500 $0 $15,000 $0 $15,000 Additional Complex Environments Set Up: Multiple charts of accounts $0 $0 $0 $60,000 $0 $60,000 Other integrations e.g. HR, Budget $0 $10,000 Custom forms $0 $4,000 $4,000 $4,000 Custom fields $0 $0 $2,000 $2,000 Custom approval rules $0 $3,500 $3,500 $3,500 Additional Set Up $0 $17,500 $0 $69,500 $0 $69,500 Total One Time Costs $0 $812,500 $0 $99,500 $0 $84,500
  84. 84. One  Time  Costs   Cost Categories Cloud Year 1 Traditional Cloud Year 2 Traditional Cloud Year 3 Traditional and Network and and Network NetworkOne Time CostsSoftware Hardware Software License $137,500 Software Upgrades $15,000 Hardware Infrastructure $35,000 Software Hardware $0 $172,500 $0 $15,000 $0 $0Typical Configuration Implementation: Data migration $0 $75,000 Services Procurement $0 $60,000 Catalogs $0 $22,500 Punch-outs $0 $15,000 $0 $15,000 $0 $15,000 Professional services $0 $175,000 Program management (vendor) $0 $150,000 Training $0 $90,000 Typical Configuration Implementation: $0 $622,500 $0 $15,000 $0 $15,000Additional Complex Environments Set Up: Multiple charts of accounts $0 $0 $0 $60,000 $0 $60,000 Other integrations e.g. HR, Budget $0 $10,000 Custom forms $0 $4,000 $4,000 $4,000 Custom fields $0 $0 $2,000 $2,000 Custom approval rules $0 $3,500 $3,500 $3,500 Additional Set Up $0 $17,500 $0 $69,500 $0 $69,500 Total One Time Costs $0 $812,500 $0 $99,500 $0 $84,500 86
  85. 85. One  Time  Costs   Cost Categories Cloud Year 1 Traditional Cloud Year 2 Traditional Cloud Year 3 Traditional and Network and and Network NetworkOne Time CostsSoftware Hardware Software License $137,500 Software Upgrades $15,000 Hardware Infrastructure $35,000 Software Hardware $0 $172,500 $0 $15,000 $0 $0Configuration Implementation: Data migration $0 $75,000 Services Procurement $0 $60,000 Catalogs $0 $22,500 Punch-outs $0 $15,000 $0 $15,000 $0 $15,000 Professional services $0 $175,000 Program management (vendor) $0 $150,000 Training $0 $90,000 Configuration Implementation: $0 $622,500 $0 $15,000 $0 $15,000Additional Complex Environments Set Up: Multiple charts of accounts $0 $0 $0 $60,000 $0 $60,000 Other integrations e.g. HR, Budget $0 $10,000 Custom forms $0 $4,000 $4,000 $4,000 Custom fields $0 $0 $2,000 $2,000 Custom approval rules $0 $3,500 $3,500 $3,500 Additional Set Up $0 $17,500 $0 $69,500 $0 $69,500 Total One Time Costs $0 $812,500 $0 $99,500 $0 $84,500 87
  86. 86. One  Time  Costs   Cost Categories Cloud Year 1 Traditional Cloud Year 2 Traditional Cloud Year 3 Traditional and Network and and Network NetworkOne Time CostsSoftware Hardware Software License $137,500 Software Upgrades $15,000 Hardware Infrastructure $35,000 Software Hardware $0 $172,500 $0 $15,000 $0 $0Configuration Implementation: Data migration $0 $75,000 Services Procurement $0 $60,000 Catalogs $0 $22,500 Punch-outs $0 $15,000 $0 $15,000 $0 $15,000 Professional services $0 $175,000 Program management (vendor) $0 $150,000 Training $0 $90,000 Typical Configuration Implementation: $0 $622,500 $0 $15,000 $0 $15,000Additional Complex Environments Set Up: Multiple charts of accounts $0 $0 $0 $60,000 $0 $60,000 Other integrations e.g. HR, Budget $0 $10,000 Custom forms $0 $4,000 $4,000 $4,000 Custom fields $0 $0 $2,000 $2,000 Custom approval rules $0 $3,500 $3,500 $3,500 Additional Set Up $0 $17,500 $0 $69,500 $0 $69,500 Total One Time Costs $0 $812,500 $0 $99,500 $0 $84,500 88
  87. 87. Annual  Costs   Cost Categories Cloud Year 1 Traditional Cloud Year 2 Traditional Cloud Year 3 Traditional and Network and and Network NetworkAnnual CostsMaintenance / Hosting / Subscription Hardware / infrastructure maintenance $5,000 $5,000 Software maintenance $27,500 $27,500 Application Support $50,000 $50,000 $50,000 Procure to Pay subscription $650,000 $300,000 $650,000 $300,000 $650,000 $300,000 Req to PO subscription Expense management subscription Contracts module subscription $0 $50,000 $0 $50,000 $0 $50,000 Payables module subscription Spend analysis subscription $0 Transaction fees $0 $400,000 $0 $400,000 $0 $400,000 Hosting fees Maintenance / Hosting / Subscription $650,000 $800,000 $650,000 $832,500 $650,000 $832,500Services Fees: Supplier enablement $0 $50,000 $0 $50,000 $0 $50,000 Supplier fees $0 $1,200,000 $2,000,000 $2,400,000 Services Fees $0 $1,250,000 $0 $2,050,000 $0 $2,450,000 Total Annual Costs $650,000 $2,050,000 $650,000 $2,882,500 $650,000 $3,282,500Opportunity Costs Savings lost from continued maverick spend $0 $1,250,000 $0 $937,500 $703,125 Savings Lost $0 $1,250,000 $0 $937,500 $0 $703,125Total Costs $650,000 $4,112,500 $650,000 $3,919,500 $650,000 $4,070,125 89
  88. 88. Annual  Costs   Cost Categories Cloud Year 1 Traditional Cloud Year 2 Traditional Cloud Year 3 Traditional and Network and and Network NetworkAnnual CostsMaintenance / Hosting / Subscription Hardware / infrastructure maintenance $5,000 $5,000 Software maintenance $27,500 $27,500 Application Support $50,000 $50,000 $50,000 Procure to Pay subscription $650,000 $300,000 $650,000 $300,000 $650,000 $300,000 Req to PO subscription Expense management subscription Contracts module subscription $0 $50,000 $0 $50,000 $0 $50,000 Payables module subscription Spend analysis subscription $0 Transaction fees $0 $400,000 $0 $400,000 $0 $400,000 Hosting fees Maintenance / Hosting / Subscription $650,000 $800,000 $650,000 $832,500 $650,000 $832,500Services Fees: Supplier enablement $0 $50,000 $0 $50,000 $0 $50,000 Supplier fees $0 $1,200,000 $2,000,000 $2,400,000 Services Fees $0 $1,250,000 $0 $2,050,000 $0 $2,450,000 Total Annual Costs $650,000 $2,050,000 $650,000 $2,882,500 $650,000 $3,282,500Opportunity Costs Savings lost from continued maverick spend $0 $1,250,000 $0 $937,500 $703,125 Savings Lost $0 $1,250,000 $0 $937,500 $0 $703,125Total Costs $650,000 $4,112,500 $650,000 $3,919,500 $650,000 $4,070,125
  89. 89. Annual  Costs   Cost Categories Cloud Year 1 Traditional Cloud Year 2 Traditional Cloud Year 3 Traditional and Network and and Network NetworkAnnual CostsMaintenance / Hosting / Subscription Hardware / infrastructure maintenance $5,000 $5,000 Software maintenance $27,500 $27,500 Application Support $50,000 $50,000 $50,000 Procure to Pay subscription $650,000 $300,000 $650,000 $300,000 $650,000 $300,000 Req to PO subscription Expense management subscription Contracts module subscription $0 $50,000 $0 $50,000 $0 $50,000 Payables module subscription Spend analysis subscription $0 Transaction fees $0 $400,000 $0 $400,000 $0 $400,000 Hosting fees Maintenance / Hosting / Subscription $650,000 $800,000 $650,000 $832,500 $650,000 $832,500Services Fees: Supplier enablement $0 $50,000 $0 $50,000 $0 $50,000 Supplier fees $0 $1,200,000 $2,000,000 $2,400,000 Services Fees $0 $1,250,000 $0 $2,050,000 $0 $2,450,000 Total Annual Costs $650,000 $2,050,000 $650,000 $2,882,500 $650,000 $3,282,500Opportunity Costs Savings lost from continued maverick spend $0 $1,250,000 $0 $937,500 $703,125 Savings Lost $0 $1,250,000 $0 $937,500 $0 $703,125Total Costs $650,000 $4,112,500 $650,000 $3,919,500 $650,000 $4,070,125
  90. 90. Results   Year 1 Year 2 Year 3Procure to Pay Costs Summary Cloud Traditional Cloud Traditional Cloud Traditional and Network and and Network NetworkOne Time Costs $0 $812,500 $0 $99,500 $0 $84,500Annual Costs $650,000 $630,000 $650,000 $727,500 $650,000 $742,500Total Costs $650,000 $1,442,500 $650,000 $827,000 $650,000 $827,000Annual Differerence $792,500 $177,000 $177,000 Total Three Year Savings = $1,146,500
  91. 91. Results   Cumulative Total Cost of Ownership Initial Investment Year 1 Year 2 Year 3On-site Development Costs $0 $3,855,000 $3,822,000 $3,987,625Cloud Development Costs $0 $850,000 $850,000 $850,000 $4.50 Millions $4.00 $3.50 $3.00 On-site Development Costs $2.50 $2.00 Cloud Development Costs $1.50 $1.00 $0.50 $0.00 Initial Investment Year 1 Year 2 Year 3
  92. 92. Calculate  Your  Own  TCO   TCO  Whitepaper   TCO  Calculator  Tool  
  93. 93. Closing Remarks Tony WesselsVice President, Marketing

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